Sears, Kmart, J.C. Penney, Macy’s, Gymboree, Teavana, Crocs, Payless ShoeSource, Bebe: The list of retailers that have closed stores this year stretches on and on.
The closures have cities that depend on sales taxes looking at ways to maintain or grow that source of revenue. All agree that big-box retailers such as Walmart or Target or a major department store will no longer be at the center of it.
Read more:Sears is closing 30 more stores -- is yours on the list?
It’s got small-business owners developing models that offer much more than racks of clothing within brick and mortar. Some are changing their model to incorporate services and experiences to lure shoppers increasingly apt to buy online.
“When you look at it from the big picture, the fact is there’s too many stores and too many malls,” said Michael Timmerman, a writer with Clark.com, a personal finance website.
The next generation of shoppers isn’t interested in going to the mall.
“It’s more work,” he said.
For a few years, cities have been discussing in earnest what changing shopping habits mean for them. For some, the sales tax is the biggest revenue generator; for most, it’s second only to property taxes.
It’s been a frequent point of discussion, said Bob Biery, vice chair of the League of California Cities' revenue and taxation policy committee.
“In the past, a lot of the sales tax generated in cities came from big-box stores,” he said.
Online shopping has obliterated that.
“I can’t imagine that any city is thinking they might have opportunity for their sales tax to increase. A lot of us will just be happy if we can hold on to what we have now,” Biery said.
Biery, who is city treasurer of Westlake Village, said the city is projecting flat sales tax revenue this year and next. The city is built out, he said, which will make growing sales tax revenue difficult.
The league’s policy committee has debated a tax on services, but the discussion has yet to go too far. Legislation introduced last year stalled and nothing was on the table in 2017, Biery said.
Other states put a tax on services such as haircuts or massages, but California does not.
In the spring, Fillmore Mayor Carrie Broggie and other city officials traveled to Las Vegas for the International Council of Shopping Centers.
The typical strip mall with a grocery store and other smaller shops may be a thing of the past, she said.
“It appears that shopping centers are going by the wayside,” she said. “You don’t just run into a mall. It has to be more than that.”
Over and over, conference attendees heard the story of the millennial, Broggie said.
Millennials often seek shops that are locally owned, they buy more consciously and many more buy online. They increasingly want an experience.
Officials began looking at ways to incorporate in Fillmore some of what they had heard in Las Vegas.
The city wants to make its shopping experience more experiential, adding music or art to downtown and perhaps utilizing pop-up stores in vacant spaces, she said. That would temporarily activate the space while allowing a small-business owner the opportunity to try out a new venture at a lower cost, Broggie said.
A recently formed arts commission is also looking at ways to make visits downtown more attractive to locals and they’re encouraging restaurants to add outside dining, she said.
Ventura City Council member Christy Weir has been thinking along those lines for a while now.
“The commercial development that’s succeeding is more experiential, like restaurants and nail salons, hair salons, massage places,” she said.
Cities used to compete for big retailers, she said.
“Now the story has changed, and we are trying to figure out the future,” she said.
Officials have long eyed the area behind Ventura’s Auto Center for business expansion. The city plans to extend Olivas Park Drive to Johnson Drive and in the past had thought of a big-box retailer for the vacant space. That may no longer be in the cards, Weir said.
It might be industrial instead, she said, pointing to the city's low vacancy rate there.
Ventura’s downtown is offering the kind of retail experience people today want, she said. You can grab a coffee or a pastry while browsing shops with personalized customer service.
“I think that’s where we’re heading. I think our downtown will be fine ... steady as far as its success," she said.
Ventura’s downtown has a lot going for it: It’s near the beach; there are ample restaurant, beer and wine offerings; more than 90 percent of the establishments are locally owned; and many of the physical spaces are small.
“Those spaces are still attractive and viable for small business,” said Kevin Clerici, executive director of Downtown Ventura Partners, the business improvement district.
Clerici said he gets calls all the time about businesses looking to open or relocate downtown, where the vacancy rate is low.
“The mix that we have now is complementary. The stores that we’re seeing are providing an experience more than just traditional retail,” he said.
Retail isn’t easy, but it’s far from dead, he said. What needs to come next is residential development, he said. Several hundreds of units have gotten the green light to be built downtown.
About three weeks ago, Wooden Nickel Home opened on Oak Street. It is lightly decorated, minimalist, catering to a shopper looking for a simple look.
The store is more than that though, explained owners Michele Caples and Courtney Kittner-Rascoe. It offers interior styling to “dress your home,” Kittner-Rascoe said.
And soon, there will be in-store classes for woodworking, candle making, natural dying or other artisan skills. Kittner-Rascoe’s husband, Matthew, also offers custom pieces.
“We felt like it was something Ventura didn’t have,” Kittner-Rascoe said.
The retail industry can be difficult, she acknowledged, “but we can’t let fears from stopping what you want to do.”
Earlier this month, Hey Beautiful! Boutique moved from midtown to 337 E. Main St. in Ventura. It is beauty bar, blow-out-bar and retail shop and offers Girls Night Out parties. Though successful in midtown, owner Deena Clevenger was looking for more foot traffic to help boost sales.
Plus, it’s next to the Star Lounge, where she is a co-owner.
Clevenger said it helped to get started and get a following from her location in midtown, where she was "known for having cute things and affordable things."
Mary Livingston used to own a shop in downtown Ventura. Lavender Blue sold refurbished "shabby chic" furniture and home accessories, distressed or antiques. She began seeing sales fall — in the days of “Flea Market Flip,” “Design on a Dime” and countless other TV shows, everyone became a DIY'er — and instead of buying, customers would just browse.
She decided to move out of her pricey downtown spot and operate out of a warehouse off Callens Road.
“Here we are. This is the new thing,” she said from her new location. There, along French soaps, organic milk paints and other American and European pieces for sale, Livingston offers home and personal design classes.
She's working to get a bigger online presence and expand the reach of her classes, which she first began teaching two decades ago.
Livingston has no qualms about the changing nature of retail. She's an online shopper herself. And she's glad to see a return to creating things, buying less stuff and supporting things that are good for the environment and local economy. She thinks shopping districts in industrial areas will start taking off.
“I'm probably going to have to expand. People have been so beautiful and supportive,” she said.
Timmerman, from Clark.com, said in the long run what will work are stores that offer affordability with quality. That's why stores such as T.J. Maxx, Ross and Marshalls are finding success.
“You just pull right up, walk in, and the other benefit, the prices are really good,” he said.
And what's happening with those buildings that used to be home to large stores? In Santa Barbara, a 141,000-square-foot former Macy's store is still empty.
But across the country, malls have been repurposed, for medical centers, mixed-use developments or colleges and universities, Timmerman said.